DISCLAIMER: GoldInvestors.news is not a registered investment, legal or tax advisor or broker/dealer. All investment/financial opinions expressed by GoldInvestors.news are from the personal research and experience of the owner of the site and are intended as educational material. Although best efforts are made to ensure that all information is accurate and up to date, occasionally unintended errors and misprints may occur.

Gold began the week with powerful momentum and ended it under the Federal Reserve’s boot. A seven session run of higher highs collapsed Friday after Fed Chairman Kevin Warsh delivered a more hawkish than expected address at the Jackson Hole Economic Symposium.

December gold futures plunged $150.70, or 3.24 percent, during the final session to close at $4,504.10. The sudden rout erased the entire weekly gain and left traders reassessing a technical picture that had appeared increasingly bullish only days earlier.

Monday initially set an impressive tone as gold futures advanced $48 and decisively cleared the 38.2 percent Fibonacci retracement at $4,692. The metal had already overcome the 23.6 percent retracement and both the 100 day and 200 day moving averages without encountering meaningful resistance.

With those barriers out of the way, the road toward the 50 percent Fibonacci level near $4,900 looked relatively clear. Buyers controlled the market, momentum indicators remained constructive, and the broader fundamental case for owning gold appeared firmly intact.

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Tuesday extended the advance to a fresh three month high and marked the seventh consecutive higher high on the daily candlestick chart. However, the session ended with an almost perfect doji candle in the star position, signaling that buyers and sellers had reached an uneasy balance before Jackson Hole.

That formation represented an early warning rather than an immediate reversal signal. Gold was still holding its gains, but the doji showed that bullish conviction was beginning to weaken at a technically sensitive moment.

The first substantial cracks appeared Wednesday after July’s Personal Consumption Expenditures report came in hotter than economists expected. Headline PCE rose 0.2 percent against expectations for a 0.1 percent increase, while the annual inflation rate reached 3.7 percent.

Those figures strengthened the dollar and pressured precious metals because persistent inflation could limit the Fed’s willingness to ease monetary policy. Gold’s decline also completed the three river evening star candlestick pattern that had emerged as a potential threat earlier in the week.

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Even then, the bulls still had a credible defense. Gold found support at the 200 day simple moving average, a level repeatedly identified as technically important, and the successful hold preserved the broader bullish argument.

Thursday seemed to confirm that the market had absorbed the damage. Although gold had suffered a $68 pullback while completing the evening star pattern, it remained above the 200 day average and appeared positioned to stabilize.

Bitcoin added to the optimistic mood by climbing above $80,000 for the first time in more than 100 days. Cryptocurrency markets often move faster because they trade around the clock and typically involve lower margin requirements, raising hopes that gold and silver could follow the digital asset higher.

Friday destroyed that comfortable setup. Gold opened at $4,656 and briefly reached $4,688, but it failed to reclaim the former support zone at the 38.2 percent Fibonacci retracement of $4,692 before sellers took control.

The closing price of $4,504.10 pushed gold below the 200 day moving average, currently near $4,641.20. That former support level has now become overhead resistance, meaning bulls must recover it before the technical backdrop can regain its earlier strength.

Gold is now testing the Ichimoku Lagging Span, with the Ichimoku cloud directly below current prices. Leading Span A stands near $4,485.50 and Leading Span B sits around $4,385.30, making the cloud the critical battleground for the coming week.

A close below $4,435, which represents the 23.6 percent Fibonacci retracement, would deliver a more serious warning and increase the risk of another move lower. The MACD remains positive, with the line at 7.4 and the signal at 107.8, but the histogram has suffered noticeable damage.

The fundamental case has not disappeared simply because one Fed speech rattled leveraged markets. A national debt approaching $40 trillion, stubborn inflation, and a central bank with shrinking room to maneuver continue to support long range demand for monetary metals.

The immediate challenge is technical rather than philosophical. Gold must hold the Ichimoku cloud, defend the $4,435 area, and eventually reclaim $4,692 before the balance of risk shifts decisively back toward buyers.

The medium term target remains $4,900 over the next 30 to 60 days, although Friday’s punishment has made that path considerably rougher. Silver also deserves attention because it continues to lag, yet its eventual breakouts are often faster and more violent than gold’s.

The analysis relies heavily on Japanese candlestick methods, including principles explored in “Trading Applications Of Japanese Candlestick Charting,” a John Wiley publication. For now, the destination may be unchanged, but Jackson Hole has forced gold bulls to prove they can survive the journey.

DISCLAIMER: GoldInvestors.news is not a registered investment, legal or tax advisor or broker/dealer. All investment/financial opinions expressed by GoldInvestors.news are from the personal research and experience of the owner of the site and are intended as educational material. Although best efforts are made to ensure that all information is accurate and up to date, occasionally unintended errors and misprints may occur.